Veterans & Bankruptcy

by DeLadurantey Law Office, LLC on July 4, 2014

If you or a loved one is a veteran and you are struggling financially, it is important to understand how bankruptcy can benefit you. Many veterans have left military service due to a disability and are receiving veteran disability benefits, so their household income is within the median income and they pass the means test. The means test is a formula used by the court to determine if an individual is eligible to file a Chapter 7 case. However, if your income is above the median level set by the U.S. Census Bureau, a veteran may still qualify for a Chapter 7 filing.

Pursuant to 11 U.S.C. §707(b)(2)(D), a disabled veteran that incurred his/her debt during a period of active duty or while performing a “homeland defense activity,” is not required to complete the means test. To qualify as being a “disabled veteran,” the vet must be either (i) rated by the Veteran’s Administrations as at least 30% disabled or (ii) discharged as a result of a disability incurred in the line of duty, as set forth in 38 U.S.C. 3741(1).

It is also worth noting that a veteran’s benefits are exempt or protected from creditors in a bankruptcy filing under 11 U.S.C. 522(d)(10)(B). This exemption can apply in Wisconsin because you are allowed to choose whether you want to apply federal exemptions or state exemptions in your bankruptcy filing. Wisconsin law also provides an exemption for veteran’s benefits. Thus, it is important to confer with a seasoned attorney to discuss which option is better for you.

Contact The “Milwaukee Bankruptcy Attorneys,” DeLadurantey Law Office. LLC. DeLadurantey Law Office focuses on student loan debt, Chapter 7 and 13 bankruptcy, debtor’s rights, debt negotiations, debt relief, mortgage loan modifications, and foreclosure defense. A “defender of the little guy, “DeLadurantey Law Office serves the following location – Milwaukee, South Milwaukee, West Milwaukee, Waukesha City, Waukesha Town, Kenosha, Racine, and all other municipalities in Milwaukee County, Waukesha County, Kenosha County, and Racine County. We can be contacted by phone: (414) 377-0518 and can be found on the Internet and on Facebook.